IN THE UNITED STATES COURT OF FEDERAL CLAIMS FIRST AMENDED COMPLAINT

Transcription

1 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 1 of 7 IN THE UNITED STATES COURT OF FEDERAL CLAIMS Nevada Controls LLC Plaintiffs, v. No T Judge Lynn J. Bush THE UNITED STATES OF AMERICA, Defendant. FIRST AMENDED COMPLAINT Plaintiff, Nevada Controls, LLC ( Nevada Controls or Plaintiff, alleges against Defendant, the United States of America, as follows: NATURE OF ACTION 1. This is a suit arising under section 1603 of the American Recovery and Reinvestment Act of 2009 ( Section 1603, for the recovery of reimbursement grants Plaintiff is entitled to under Section JURISDICTION 2. This Court has jurisdiction pursuant to the Tucker Act, 28 U.S.C. 1491, which grants to this Court the right to render judgment upon any claim against the United States founded either upon... any Act of Congress or any regulation of an executive department[.] Plaintiff s claim is founded upon Section 1603, which provides grants to those who place into service specified energy property. 3. Section 1603 is money mandating, thus conferring a Tucker Act right. 4. This case is ripe for adjudication because the United States of America, through the Secretary of the Treasury, has refused to review Plaintiff s claim to grant payments under Section At all times relevant hereto, Nevada Controls was and is a Nevada limited liability company licensed to do business in the State of Nevada.

2 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 2 of 7 6. The Defendant is the United States of America. STATUTORY BACKGROUND 7. Congress passed the American Recovery and Reinvestment Act of 2009 for the purpose of creating and saving jobs, and spurring investment in long-term growth, including clean energy projects. 8. As part of the American Recovery and Reinvestment Act of 2009, Section 1603(a directed the United States Department of Treasury ( Treasury to make grants to those who placed into service specified energy property, as defined by reference to the renewable energy tax credit provisions of Internal Revenue Code Sections 45 and Under Section 1603(a, grants were to be issued for specified energy property placed into service during 2009, 2010, or 2011, or, if placed into service after 2011, if construction of the property began during 2009, 2010, or Under Section 1603(b(2(A, the Treasury was mandated to issue grants in an amount of 30 percent of the basis of certain qualifying property. 11. The Section 1603 grant program was unlike other federal grant programs, in that it was designed to transfer a financial benefit originating from a tax credit. GENERAL FACTS 12. Plaintiff Nevada Controls is a licensed general engineering and electrical contractor located in Carson City, Nevada. 13. Plaintiff undertook four clean energy projects for which it qualifies for a Section 1603 grant in a total combined amount of $553,716, constituting 30 percent of the combined basis of such specified energy property. 14. The name of each clean energy project, along with the respective grant amount sought and completion date are as follows:

3 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 3 of 7 Project Name Grant Amount Completion Date T Five Ranch $192,858 October 16, 2012 Young Brothers Ranch $96,429 October 10, 2012 Gandolfo Farms $96,429 October 9, 2012 Rafter 7 Ranch $168,000 Approx. Nov Throughout the years 2011 and 2012, Plaintiff submitted to the Treasury various descriptions, reports, and correspondences regarding its clean energy projects, while securing application identification numbers and submitting information to satisfy the supplemental rules and guidelines ( Program Guidance devised by the Treasury and Department of Energy to administer the Section 1603 grant program Under the Program Guidance, no hard copy submissions of any materials were accepted, and all information was required to be provided through online accounts. 17. Nevada Controls attempted to follow all the requirements and was proactive in attempting to provide the documentation requested under the Treasury s Program Guidance, including sending documents relating to projects subject to the present dispute. 18. On June 15, 2010, Treasury acknowledged in writing receiving an initial application from Nevada Controls for a Section 1603 grant for one of Plaintiff s clean energy projects, and directed Nevada Controls to withdraw its application and submit a new application after the property was placed into service. 19. Based upon this directive from Treasury, Nevada Controls did not submit any further formal initial applications (known as Begun Construction Applications for its Section 1603 projects. 20. In mid-october 2012, Nevada Controls attempted to submit the final Section 1603 applications for its projects, verifying the statutory requirement that the projects be completed within the 2012 year, but was informed by Treasury personnel that the 1 The Treasury and Department of Energy issued Program Guidance in August 2009 and March 2010 to state the rules and procedures of making a claim under the Section 1603 grant program. The Program Guidance issued without public participation and did not follow any other formal rulemaking standards for executive agencies.

4 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 4 of 7 information previously provided would not constitute an application, and that Nevada Controls had lost the chance to receive a grant because Nevada Controls failed to submit a timely application by the October 1, 2012 deadline. 21. Nevada Controls immediately requested an administrative review and/or appeal of the Treasury s denial but was informed that no such remedy was available Treasury s delay in issuing Section 1603 grant payments is having a catastrophic impact on the financial health and viability of Nevada Controls. 23. Nevada Controls financial statements have been severely harmed, disqualifying Plaintiff from additional clean energy projects, putting at risk payments owed to vendors, and endangering Nevada Controls ability to continue as a going concern. 24. Nevada Controls good-faith efforts to fulfill the purpose of the American Recovery and Reinvestment Act of 2009, by employing eight full-time and six part-time employees, and developing sustainable clean energy projects, are jeopardized by the grant money shortfall. FIRST CAUSE OF ACTION Erroneous Denial of Claim for Section 1603 Grant 25. Plaintiff repeats and realleges those claims and allegations set forth previously as if the same were fully set forth herein. 26. As the Treasury applied and interpreted its own Program Guidance, the Treasury has historically taken the position that it has complete discretion on determining whether any submission constitutes an application, as well as whether it would be proper to request supplemental information from a potential grant recipient. 27. The submissions by Nevada Controls of reports and descriptions of its clean energy projects prior to the October 1, 2012 deadline, including the submission described by 2 Because the Program Guidance does not provide for remedies of disputed issues, there is no official administrative record of the matter as would otherwise be found in a dispute involving tax credits.

5 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 5 of 7 Treasury as an initial application in a June to Plaintiff, constituted applications under Section 1603(j. 28. As Plaintiff timely supplied applications for its clean energy projects, and as these projects otherwise fulfilled the statutory requirements for Section 1603 grants, the Section 1603 grants were erroneously and illegally denied by Defendant. 29. The total statutory Section 1603 grant amounts for Plaintiff s four qualifying energy properties is $553, The delay in Section 1603 grant payments has impeded Nevada Controls ability to satisfy obligations to lenders and vendors, and Plaintiff estimates it has incurred over $40,000 in loan penalties and interest as a result. 31. Plaintiff is the sole owner of the claims included and asserted herein, and has made no assignment thereof. No action on the claims has been taken by Congress or departments of the U.S., other than the actions by the Treasury Department hereinbefore described. No other suit or process by Plaintiff is pending on such claims in any other court. SECOND CAUSE OF ACTION Abuse of Discretion 32. Plaintiff repeats and realleges those claims and allegations set forth previously as if the same were fully set forth herein. 33. As the Treasury applied and interpreted its own Program Guidance, the Treasury has historically taken the position that it has complete discretion on determining whether any submission constitutes an application, as well as whether it would be proper to request supplemental information from a potential grant recipient. 34. The submissions by Nevada Controls of reports and descriptions of its clean energy projects prior to the October 1, 2012 deadline, including the submission described by Treasury as an initial application in a June to Plaintiff, constituted applications under Section 1603(j.

6 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 6 of As Plaintiff timely supplied applications for its clean energy projects, and as these projects otherwise fulfilled the statutory requirements for Section 1603 grants, it is an abuse of discretion for Defendant to deny the Section 1603 grants to Nevada Controls. 36. Additionally, Treasury has been on notice regarding Plaintiff s claim for a Section 1603 grant at least since June 15, 2010, when it acknowledged receiving an initial application for a Section 1603 grant from Nevada Controls. 37. Defendant s plain instruction to Nevada Controls to withdraw the initial application for a Section 1603 grant planted a belief in Nevada Controls that formal initial applications were unnecessary. It would be inequitable and an abuse of discretion for Defendant to deny Nevada Controls its grant based upon a misunderstanding initiated by Defendant about the necessity of a formalized initial application by a particular date. 38. Further, Defendant s abuse of discretion in denying Nevada Controls its Section 1603 grant is undermining the Congressional intent of the American Recovery and Reinvestment Act of 2009, by jeopardizing the employment of fourteen employees, harming vendors and lenders, and halting clean energy infrastructure projects. 39. Plaintiff is the sole owner of the claims included and asserted herein, and has made no assignment thereof. No action on the claims has been taken by Congress or departments of the United States, other than the action by the Treasury Department hereinbefore described. No other suit or process by Plaintiff is pending on such claims in any other court. WHEREFORE, Plaintiff prays for judgment against Defendant as follows: 1. On Counts One and Two of this Complaint, for relief in the form of judgment in favor of Plaintiff and against Defendant for the Section 1603 grants due to Plaintiff in the total amount of $553,716, along with interest; and judgment adjudging the denial of the claim for Section 1603 grants against Plaintiff to be erroneous and illegal. 2. For damages Plaintiff has incurred as a result of the delay of the Section 1603 grant payments in the form of loan penalties and interest, in the amount of $40,000.

7 Case 1:12-cv LJB Document 17 Filed 08/12/13 Page 7 of 7 3. For an award of reasonable attorneys fees and costs of suit, and pre- and postjudgment interest. 4. For such other and further relief, including equitable relief, as the Court determines to be just and proper in the instant matter. DATED this 12th day of August, Respectfully submitted, s/bryan D. Dixon BRYAN D. DIXON 1540 W. Warm Springs Road Suite 100 Henderson, NV Telephone: ( Facsimile: ( bdixon@taxlawnv.com Attorney for Plaintiff